G.R. No. 39996 ; March 28, 1934
PRUDENCIO DE JESUS, plaintiff-appellant, vs. FERNANDO GREY, JR., and THE PHILIPPINE POSTAL SAVINGS BANK, defendants. FERNANDO GREY, JR., appellant.

FACTS

Prudencio de Jesus executed a power of attorney in favor of his son-in-law, Fernando Grey, Jr., authorizing him to sell or mortgage two parcels of land. Using this power, Grey mortgaged the property to the Philippine Postal Savings Bank for P12,000. De Jesus sued, claiming he never executed the power of attorney or that his signature was obtained by fraud, seeking its annulment and damages. The trial court upheld the validity of the power of attorney and mortgage but ordered Grey to pay de Jesus P12,000 as damages. Both parties appealed.

ISSUE

1. Whether the power of attorney and the mortgage executed pursuant thereto are valid.
2. Whether Grey is entitled to compensation under a separate agreement regarding the Solis-Tondo Subdivision.

RULING

1. Yes, the power of attorney and mortgage are valid. The Supreme Court, after reviewing the evidence, found that de Jesus voluntarily signed the power of attorney with knowledge of its contents, which authorized Grey to mortgage the land to raise funds for de Jesus’s obligations. The testimony of the instrumental witnesses and notary public prevailed over de Jesus’s claims of fraud.
2. Yes, Grey is entitled to compensation under the separate agreement. The Court upheld Grey’s cross-claim based on a valid power of attorney (Exhibit 2) entitling him to 2% of the gross income from the Solis-Tondo Subdivision. De Jesus was ordered to render an accounting and pay Grey accordingly. However, the Court affirmed the trial court’s invalidation of a P150,000 promissory note for lack of valuable consideration.
The appealed judgment was modified: the validity of the power of attorney and mortgage was affirmed; the order for Grey to pay damages was reversed; and de Jesus was ordered to comply with the separate compensation agreement.

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